Australians think ‘it won’t happen to me’

A national survey of over 500 financial advisers conducted at a recent life risk roadshow by Zurich Financial Services Australia has found the reason behind the underinsurance problem in this country is that people believe they will never experience something bad in their lifetime.

As many as 50 per cent of the advisers asked during the roadshow said they thought their clients had not taken out sufficient insurance for this reason.

A further 22 per cent of advisers felt people were underinsured because they did not know about personal insurance, while another 19 per cent believed their clients did not take out this type of insurance because it was deemed too expensive.

And advisers reinforced the underinsurance gap remained a real concern for Australian society, with 73 per cent of those surveyed estimating that families in general needed minimum life cover of $1 million to be safe. The average coverage for Zurich Australia clients currently stands at $400,000.

However, in a finding that may make Australians rethink their approach toward life insurance, 60 per cent of advisers said they had a close friend or family member who had been diagnosed with cancer in the past two years.

In addition, 57 per cent of respondents admitted to having a cardiovascular risk factor in their personal profile.

Marc Fabris, strategic marketing manager, Zurich Australia said: “A significant challenge our industry faces is to appreciate the reality of life risks and the consequences of these risks so that action is taken — both by advisers in raising the issues and clients in heeding their advice.”